Managers Must Have a Knack
For Picking an Effective Team

By

Carol Hymowitz Staff Reporter of The Wall Street Journal

Updated March 27, 2001 4:05 p.m. ET

NO MATTER HOW inspiring a leader you are, you are only as effective as your team.

It is a maxim that Richard H. Brown, chief executive of Electronic Data Systems in Plano, Texas, reminds himself of every day. In his two years at the helm of the computer-services giant, he has made "putting the right people in the right jobs" the key ingredient of his turnaround effort at EDS.

"It's not an easy challenge to pick winners and it's an even harder challenge to help that talent develop and progress," says Mr. Brown, 53 years old.

A telecom veteran from Ameritech and Cable & Wireless, he has moved boldly at EDS, shaking things up by rating all employees annually on a scale of one (excellent) to five (unsatisfactory) and showing poor performers the door.

Within months of his arrival, he cut 13,500 jobs, including the bottom 20% of the sales force, and reshuffled his top management team. He dismissed many veterans, elevated others and recruited fresh talent.

HOW DID MR. BROWN decide who would go, who would stay and who would be wooed? "Being smart is the price of admission; what counts is how effective you are," he says. He looked for managers who had outperformed peers throughout their work histories and made a habit of excellence.

Concerned that EDS was fat and complacent -- on his arrival, the company had 48 business units operating as separate fiefs -- he sought employees willing to try new approaches and compete fiercely to win customers. He also analyzed how well they worked with others.

Early on, he asked 30 top managers to e-mail him "the three most important things that Dick Brown has to do to get EDS back on track" and the three things each of them had to do, he says.

"We all seemed to agree that the company needed a new sense of urgency," says Mr. Brown, who made his request at a Monday meeting and asked the managers to deliver their reflections to him by the end of the week, at the latest.

Only five of the managers sent their e-mails before 4 p.m. on Friday. "And many focused more on what I needed to do than on what they needed to do," says Mr. Brown. Only a handful of those managers are at EDS today.

As Mr. Brown restructured EDS's 48 units into four streamlined businesses, he says he also found "gold talent inside the company who were being underutilized" and promoted them.

At the same time, he went after fresh talent that would challenge the status quo. In August 1999, he tapped Don Uzzi, who had led a marketing turnaround at Quaker Oats ' Gatorade business but had been fired from Sunbeam by "Chainsaw" Al Dunlop. He wanted Mr. Uzzi to make EDS a household name.

"I knew Don was a fantastic brand manager who could raise our profile, and that's what counted for me," says Mr. Brown.

WHILE MR. BROWN has blended old and new talent at EDS, Raj Jaswa, founder and CEO of Selectica , a San Jose, Calif., maker of corporate software, has built a team from scratch. Starting with four employees four years ago, he now oversees a staff of 750 at Selectica, which went public last March.

Mr. Jaswa has had to compete against other start-ups in Silicon Valley for talent while carefully timing his selection of new hires. He waited to hire a chief financial officer until about a year before he began preparing to take Selectica public. Before then, he says, "all we really needed was a controller to manage our money internally."

As the company prepared for its IPO, however, he began interviewing CFO candidates with broader financial experience and an ability to oversee investor relations.

He also went after a vice president of sales willing to build and manage a sales force. "In a start-up, you don't have an established business base on which to grow," he says. "You have to create that yourself."

Despite their different talent needs, both executives agree that one quality they always seek in job candidates is optimism. "I'm always asking myself, does this person have a bright and sunny outlook, because you don't want long faces around you," says Mr. Jaswa.

Similarly, Mr. Brown tries to distinguish between what he calls energy suppliers and energy drainers.

"Energy drainers are worriers who have more shadows than sunshine," he says. "You talk to these people and you feel drained at the end of the conversation. By contrast, energy suppliers don't have all the answers but they say 'Leave it to me, I'll find a way.' You feel good being around them and you want more of them."

Despite all his best efforts, he invariably makes some bad choices. When that happens, he says, he tries to "face my mistake, fix it and move on."

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